Regular Meeting Minutes

October 7, 2002

Call to Order

The October 7, 2002 Lake Linganore Association board of directors meeting was called to order at the Lake Linganore Association office at 7 p.m. by association president Jim Reed.

Also Present:

President Reed turned the floor over to Bill Diloreta of Land Stewards to present a report about the progress of the new declarant/developer. Mr. Diloreta said the company would be doing a “soft” grand opening for the next few months with a stronger grand opening ceremony scheduled sometime later. He said the company had moved its sales offices into the barn building off of Rt. 144, which was being renovated for that purpose. He said the company had signed contracts with two builders— Craftmark and Beazer. He said the two builders would be paying a fee of $1,000 per house to the LLA, most likely to be used for amenities in Woodridge. He said the combined amount from the two builders to the LLA should total approximately $92,000. Director Young asked when the builder became obligated to deposit the $1,000; Mr. Diloreta said at settlement. At a later point in the discussion Mr. Diloreta questioned the validity of a previous “agreement” that stipulated this fee and the fact that the agreement did not require a double signature for expenditures rather it required only the LLA’s signature. GM Hembree explained that Frank Ellis, from whom Land Stewards purchased its major holdings in the PUD, set up the agreement. He also asked if the builders’ contract stipulated a “take down” schedule or in other words will they settle on a given number of lots on a quarterly basis rather than settling on lots at once. Mr. Diloreta stated that contracts do have a take down schedule.

Mr. Diloreta also spoke to the board about landscaping work it wanted the association to do at the Brosius Dam Rock, at a cost of approximately $10,000, to be done before the Land Stewards’ early November grand opening activities. In addition he mentioned two village signs that Land Stewards wanted the LLA to repaint, one of which it was determined had recently been repainted. Mr. Diloreta had the understanding that the executive committee of the LLA board of directors had agreed to pay the $10,000. LLA president Reed and GM Hembree explained to Mr. Diloreta that the area of the dam was expected to undergo a major construction rehab project soon and that spending the money at this time would not be practical. They also explained that the executive committee understood that Land Stewards wanted the LLA to do something to improve the appearance of the rock but that it was their understanding that Land Stewards would present a plan for the board to review at a future date. After some discussion Mr. Diloreta withdrew the request for funding the proposed landscape plan. He added that Land Stewards should be ready to deliver lots to the builders within 60 days.

Resident John Snow noted that before the association did undertake the landscape project it should check with the Maryland Dam Safety Division to determine if there are any restrictions/requirements that may impact the amount of work to be done.

Mr. Reed took the opportunity to thank Mr. Diloreta and Land Stewards for two agreements giving the LLA use of trails and the twin barns it owns.

The committee will recommend credit card software that will allow members to pay dues by credit card. GM Hembree told the board the fee that the LLA would pay to the credit card companies could be passed along to the member who uses the service. Mr. Young also noted that the association is seeing “good results” with the delinquent dues collection activity.

The Finance Committee is in dire need of members, he said, adding that one person recently stepped down and that another may in the near future. LLA president Reed said the committee is one of the most important to the association and that potential members needed financial skills to be able to handle the various responsibilities. He added that if the committee is unable to get volunteers that the LLA needs to hire an additional full-time financial staffperson.

A. Legal Opinion on Bylaws Article IV, Section 12 (b)— prohibitive aggregate expenditure cap.

GM Hembree reported to the board that Shelah Lynn, principal of Chadwick Washington law firm, brought the bylaw dilemma to his attention as she was researching another matter. The bylaw as written is not clearly defined and it puts an annual restriction on the board’s ability to spend money on capital improvement projects that is unrealistically prohibitive (five percent of the budgeted gross expenses) and as a result the bylaw has been violated on numerous occasions for a variety of projects that the association has completed. He noted that the bylaw needed to be changed in order for the meeting room addition to proceed.

Ms. Lynn suggested that the expenditure cap be changed to more current standards, which she noted as 25 percent. She also suggested that the board consider eliminating donated funds from the cap restriction if it decided to change the bylaw. Mr. Hembree said that under the bylaw even the money donated by developers to the association for projects could not be used as outlined under the cap. He noted the board has the authority to change the bylaws and that the document overall contains checks and balances that allow members to challenge any project deemed as improper.

LLA director Young expressed his concerns about the Catch-22 of the situation and questioned that if the bylaw could be changed at any time, why bother to delineate a specific percentage at all. LLA president Reed said he had trouble with the existing bylaw because it also affected the way the LLA money market accounts are handled. LLA director Sheehan said the cap had been tripped before and the addition project was something that everyone wants. Mr. Reed said that even the SHUR funding expenditures, under the current bylaw condition, would require a two-thirds vote of the members before road repairs could be made.

Summerfield resident Pat Curley registered a complaint about the cost of the sidewalk repair project in that village. He wanted to know why the sidewalks were not considered a community amenity and money for repairs was not taken out of the general operating budget. GM Hembree explained that the LLA does not own the sidewalks and that technically the individual homeowner is responsible for the condition of the walkways. He said the board has looked at ways it could help with the cost and that ultimately it decided to contribute $1,300 toward the cost of the repairs. Mr. Colombo said that the project involves 150 slabs, impacting 40 homes in that village.

LLA vice president Alan Dinkelacker made the motion to adjourn the meeting, which was seconded by Mr. Young. The meeting adjourned at 10 p.m.

Respectfully submitted by,

Stephen Hembree Jerry Dorsey

LLA General Manager LLA Secretary